China stocks fall as higher global yields, geopolitical tensions weigh

Business Recorder reported that Chinese equities declined on Monday, even as Beijing's supportive steps failed to stabilise a weakening market. Sentiment was weighed down by climbing international rates and escalating geopolitical strains. The large-cap CSI300 lost 0.2% in the morning session and hovered near a one-year low, while the Shanghai Composite eased 0.1%. In Hong Kong, the Hang Seng gained 0.2%.

A US move to open patent infringement probes into Luxshare Precision Industry and Foxconn Industrial Internet further hurt risk appetite. Foxconn dropped by up to 7%, reaching its weakest level in six months, while Luxshare lost 2% and came near its lowest since March. Consumer electronics, telecoms and property were the heaviest decliners, whereas banks and consumer names advanced.

Analysts at Caitong Securities attributed the weakness mainly to rising global yields and flagged the risk of a debt crisis linked to the weakest euro zone governments. The wider Middle East conflict has pushed oil prices higher, adding to inflation concerns and bond yield pressure. Concerns about exports also intensified after European Trade Commissioner Maros Sefcovic said on Friday that China and the EU struck a deal that could lower Chinese hybrid car shipments to the bloc by over half. Support steps, such as a Saturday seminar where regulator chief Wu Qing sought market views and draft rules to ease equity fund setup, drew only a muted response.